Courthouse Steps Oral Argument Teleforum: Google v. Oracle

[Music]

Dean Reuter:  Welcome to Teleforum, a podcast of The Federalist Society's practice groups. I’m Dean Reuter, Vice President, General Counsel, and Director of Practice Groups at The Federalist Society. For exclusive access to live recordings of practice group teleforum calls, become a Federalist Society member today at fedsoc.org.

Nick Marr:  Welcome to The Federalist Society’s Teleforum conference call. And this afternoon, October 7, 2020, we’ll have a special Courthouse Steps Oral Argument teleforum where we’re reviewing oral arguments heard today in Google v. Oracle. My name is Nick Marr. I’m Assistant Director of Practice Groups at The Federalist Society.

      As always, please note that expressions and opinions on today’s call are those of the experts.

And today, we’re fortunate to have with us Jordana Rubel. She’s Assistant General Counsel at the U.S. Copyright Office, and she helped to cowrite the government’s brief, in this case. And we have Professor Michael Risch. He’s the Vice Dean and Professor of Law at Villanova University’s School of Law, and he’s the author of an amicus brief in support of Google.

And our moderator, this afternoon, is Steven Tepp. He’s President & CEO of Sentinel Worldwide. He’s also a lecturer at George Washington University Law School, and he was the author of an amicus brief in support of Oracle.

      So, after our speakers give their remarks and some moderated discussion from Mr. Tepp, I will go to audience question and answer, so be thinking of those for when we get to that portion of the call. And so I’ll hand the floor out first to Steve. Thanks for sharing with us today, Steve. Go ahead. The floor is yours.

Steven Tepp:  Thank you very much, Nick, and thanks to The Federalist Society for hosting this Teleforum. We had a fascinating and lively oral argument this morning, so let’s get right to it. By way of a quick background, when Apple announced the first iPhone in 2007, Google had to scramble. They were by all reports working on a version of Android that would’ve essentially been a Blackberry clone with a few more features.

It’s well known that Google and its business partner, Samsung and Motorola Mobility, copied many operational aspects of the iPhone, and some of our listeners may be aware of the patent litigation that ensued. But they also copied some copyrightable works or what Oracle says are copyrightable works. Specifically, Google understood that part of the appeal of a mobile device would be the types and volume of apps available on it—the functionality those apps provide.

And by adopting the widely used and well-known Java-based API programming, Google was able to create an environment in which app developers would readily be able to develop new apps, thus making their Android platform quickly competitive with Apple’s.

Google was offered, but refused, to take a license from Oracle, the successor in interest to Sun Microsystems, the original author of the Java code. And Oracle sued in 2010. The district court ruled the code was not copyrightable, and the federal circuit reversed. The Supreme Court denied cert in 2015, and they remanded back for further consideration.

The Second District Court proceeding resulted in a finding of fair use, and again the federal circuit reversed. This time cert was granted both on the questions of copyrightability and fair use, and here we are. Oral argument was held this morning at 10:00 am. Both parties are backed by numerous amici. The United States weighed in on Oracle’s side with Deputy Solicitor Malcolm Stewart arguing. And, as you will hear, Google had Justice Breyer making their arguments.

I offer my own observations about the oral argument and invite our panelists to agree, disagree, or make other observations. I heard great skepticism of Google’s copyrightability arguments, and I’m not sure I could identify even a single justice who seemed to find them appealing. There was, to me, surprisingly, little discussion on the merits of fair use; although, they did get to some transformative-use questions later on.

There was significant discussion, however, of the standard of review of jury decisions on fair use; although, I didn’t hear anyone suggest that they were not reviewable at all. And then there was a good amount of discussion on the policy side with both litigants arguing that ruling for the other side would harm innovation. A number of Google’s amici, in particular, urged that a ruling for Oracle would upset settled industry expectations, and that got a fair amount of discussion.

Perhaps, most notably, as I alluded a moment ago, Justice Breyer made several—for lack of a better term—speeches about why ruling for Oracle would be terribly damaging. It was, to me, quite a striking display of open advocacy. Although, surely, no one’s surprised that he takes that perspective on this case given his history. So let’s begin with our panelist who takes the perspective that is sympathetic to the petitioner, Google. Professor Risch, please go ahead.

Prof. Michael Risch:  Sure. Thank you and thank you for having me, and thanks to The Federalist Society for hosting. I will say that I have learned not to guess how cases are going to come out after oral argument. This case is no different.

I suppose I was not surprised by Justice Breyer’s long questions because I’ve heard him ask very similar long questions or, at least, read them in transcripts many times. And so it’s pretty common practice; although, he did ask very long questions of each side. Although, they had similar substance.

But was really interesting about the oral argument is that you could instantly tell the weak side of each party by the questioning, and, usually, it’s one issue ad issue, and so the weak side are the little minor parts of it. But, here, it was two questions presented, and there were literally questions about the first question to one party, and the second question to the other party.

So what do I mean by that? Google got most questions relating to copyrightability: “What do you mean? What about merger? Aren’t you just stealing from the goodwill?” From: “Aren’t you stealing from the goodwill from Oracle, etc.? When does merger get counted as at the time of creations, at the time of reuse, etc.?”

Oracle, on the other hand, most of the questions were about fair use. “What about the standard review? Why shouldn’t the jury’s verdict stand?” etc., etc. And so that really frames where the issues are, and the interesting thing is either one of those questions could resolve this.

And so what’s funny is you could theoretically see a reversal, here, with a fractured opinion. You could split 4-4 and have Google win unanimously. You could have a 4-4 split that it’s copyrightable. You could have a 4-4 split that there should be fair use, and what you wind up with, then, is an 8-0 split that the fair use is there. Now, I don’t think that’s how it’s going to break, but it’s a possibility.

That was the 10,000-foot view. So moving down a little bit, I think really what was happening throughout all of the questions is that the court and also the advocates are struggling with the key question, which is “What are we going to do about APIs?” Now, you’d think they wouldn’t be struggling with that because that’s the key question in the case, but we are because it seems like nobody can get their arms around what’s really at stake here.

We saw nibbling at it at the edges, referring to the amicus briefs of the computer scientists who say that APIs are used, etc., but nobody just blatantly asked the key question, which is “Are we going to allow people to write compatible compilers or not? If somebody makes the C language, are we going to allow other people to make the C compilers or does the person who writes the C language get to own the C language forever? Is the person who writes Fortran get to own Fortran for practically forever because they’re the only one who can write a compiler?”

That’s the question that’s at stake here, and nobody seemed to say that clearly. Because that is a really important question. And the other thing that didn’t come out on that question is that everybody is already reusing compilers. Oracle is coming at – APIs. Oracle is making a compatible API so that it looks like it is Amazon Web Services because it wants to compete, and it wants to take advantage of the fact that people have already written code that works with Amazon Web Services.

To me, the hubris of Oracle pushing this case while also advertising that it’s written APIs that are the same as Amazon’s Web Services is amazing because this is how competitive functioning works. Getting down to a little bit more detail and the struggling with this key question, one thing that was interesting, to me, is that the analogy in Google’s brief, about this being like a file cabinet, got no traction at all. Nobody mentioned it. Nobody used it as a way to talk about things.

The chief justice came out with a question that said, “What about all the headings of a brief?” And I felt like there wasn’t a good answer to that question or that -- it was almost like he wasn’t ready for that question. And then, later, we got to the QWERTY keyboard, and we got to the grocery store. And, theoretically, those aren’t copyrightable, but, of course, they are with the grocery store. If you do a menu, a map of where your groceries are, well, then that would be copyrightable. To me, that was a really good analogy.

Because if you have a catalogue of where your groceries are, and it’s copyrighted because you had created structure, sequence, and organization, does that mean that nobody else can organize their groceries in the same way because it would necessitate making a catalogue that looks the same? That is getting at the point, but that was just a minor little question right at the very end. There was no traction for any of these analogies, and I think that really made the argument suffer a little bit.

The next point I’ll talk about is that, finally, they got to my key issue. And so this is really “What about my needs?” I wrote an amicus brief in favor of Google, and it took a slightly different tack. It said “look,” and it was ironically targeted at Justice Ginsburg who sadly was not there on the Court to rule on it, but the idea is that “Yes, of course, this is copyrightable.” Justice Gorsuch wound up asking that question: “Can we get past the point of saying that the code is not copyrightable and instead talk about filtration?” which Justices Kagan and Sotomayor wound up talking about eventually.

That is my take in the brief that the problem, in this case, is really the procedural posture, that the jury found infringement because there was never given an option to do filtration, that if they had done the type of filtration you ordinarily do, this would be not an usual case. None of the parties really cited Bateman v. Mnemonics, which is an API abstraction-filtration-comparison case, which was completely non-controversial in its day. This case could’ve been just like that.

      And then, finally, I’ll end with a point that came up over, and over, and over again—I don’t know if we’ll get an answer to it in this case, but in the weeds of copyright doctrine, this question of “When do you consider a merger? Do you consider it at the time of creation or at the time of reuse?” I’m not sure we’ll get a good answer to that.

The reason I wrote my brief is I tend to disagree with Google on this. I think the question of merger is generally at the time you create, but I don’t think it matters because if you’re doing filtration properly, you are filtering out those things that you need to make the functional aspects of the work work.

And one thing that did not get mentioned at all, here—also, in the doctrinal weeds of copyright, and I’ll end on this—is that Baker v. Selden doesn’t just say we separate idea and expression. It also says that when we’re talking about reusing something that’s functional, we allow it even if some expression might go along with it. And so all of this argument about the fact that there was expression, and Oracle could’ve done this a different way, to me, is mostly irrelevant. One way or another, if you are going to have a compatible compiler—and that’s the big policy question—then some expression is going to have to go along with it.

And so we don’t have to argue about whether it’s copyrightable. We don’t have to argue about whether it was created. We don’t have to argue about whether it’s structure, sequence, and organization. The only thing we have to ask is “Are these the types of things that you use in order to make a compatible compiler or interpreter work?” And the answer is yes, and that’s the end of it. So that’s all I have. We can talk more in discussion in questions.

  Steven Tepp:  All right. Thanks very much. Before we get to Q&A, let’s, of course, hear from Jordana Rubel at the Copyright Office.

Jordana Rubel:  Thank you. Good afternoon and thank you also to The Federalist Society for hosting this call. I guess I want to echo several of the comments that Professor Risch just made in terms of the copyrightability portion of the argument. I was also struck by the number of analogies that the justices were trying to hold onto or try to understand the issues -- through the lens of which they were trying to understand the issues.

I think it’s important to know that there are two separate but related types of infringement that have been alleged in this case. One is verbatim copying of the specific declaring code, and then the second, which I think is where the analogies really come in, is the underlying SSO, the structure, sequence, and organization of the whole system of declaring code that’s incorporated in Java SE. And it’s the SSO, I think, that the justices are really trying to understand through the use of analogies.

I made a list of the different analogies I heard—some of which have already been mentioned: the headings and organization of a legal brief, a football playbook, a mathematical proof, the organization of a restaurant menu, the organization of produce in the grocery store, and then you had Justice Breyer continually discussing the QWERTY keyboard and the switchboard systems.

So I think it is a little bit hard to visualize what are we really talking about when we’re talking about structure, sequence, and organization, and there is a tension, I think, in trying to put those kind of abstract ideas to cabin that into something that might be protectable by copyright. The government has taken the position that that is protectable by copyright, but I definitely sensed, in the argument, that all of the justices were looking for some analogy there because computer software code is a hard thing, I think, to wrap our minds around; especially, something when we’re not talking about verbatim copying but we’re talking about copying something that’s more structural. It’s like a different level of abstraction.

A few other things I would note about the copyrightability discussion: in the briefing, there were two main arguments that Google had made. One had to do with Section 102(b). Section 102(a) essentially says that you give copyright protection for the expression, and Section 102(b) says but we don’t give copyright protection for things that are more like the idea, or the method of operation, or the process. And Google, in the briefing, had made the argument that the declaring code and the SSO should be considered a method of operation.

And they did continue to make that argument in the oral argument today, but that was certainly not their primary argument. I did find it interesting that Justice Breyer did continue to focus on this. He seems to feel like the QWERTY keyboard and the switchboard system that the declaring code here is analogous to those things because it is a method by which we operate the Java SE system, but most of Google’s time discussing copyrightability really focused on the merger argument.

And, there, I think there’s two questions that the parties seem to disagree about. So, just briefly, the merger doctrine says that expression normally is not -- expression normally is protected by copyright, but if there’s only one way or a limited number of ways to express an idea, then the expression merges with the idea, and it no longer is protected by copyright.

So I think the first issue is the parties are disagreeing about what is their one way to express here. I think that Oracle is arguing -- and the government has agreed with Oracle in this case. Oracle is arguing that the issue here is “Was there any conceivable other way that Google could’ve written the declaring code in the Java language?” So we’re conceding that we’re only talking about the Java language. “But was there any other way that they could have written the declaring code here?”

And Oracle says, “Yes, the evidence says there were other ways that they could have written it in the Java language, so the merger doesn’t apply.” Google says that that’s not what the merger questions asks. Google says the merger question should be “Was there another way that they could’ve written a declaring code that would have been able to interact with calls in Java SE that developers already know?”

So they’re disagreeing about what the question is there. And depending on which way the justices come down, obviously, I think that will determine how they find on merger here. The other issue on merger that Professor Risch also mentioned is just the timing of the analysis, and Oracle and the government have taken the position that the relevant time is at the time of creation of the second work.

So at the time of creation of the original work -- at the time the original work was created was it possible to express the declaring code in a different way? And the evidence is clear and unambiguous that Sun could’ve written the declaring code, or it could have organized the declaring code in many different ways.

But Google has taken the position that the relevant time is at the time of the creation of the second work, and, at that time, they say it was necessary for them to copy the exact language and SSO so that the code would interact with the calls that the developers already know. And I think that issue, it raises some other interesting and complicated questions, and I think this came out a bit in the oral argument. The government took the position that you don’t want to penalize a copyright holder or owner just because their work has become well known or popular. From a practical standpoint, how would you even know at what point a work has become well known enough or used by the industry enough that the merger doctrine would apply. That seems like a very difficult test to apply.

On the other side, of course, you had Google saying—and it did seem like there was some traction among the justices—that there is a concern that something that becomes an industry standard, like the QWERTY keyboard, shouldn’t be able to be owned by one party because it becomes effectively anti-competitive. Those were the major two issues that I think were erred in connection with copyrightability.

On the issue of fair use, I have just a few points I wanted to make. I agree with the other folks on the panel that the major issue related to fair use seems to be the standard of review. You might know that the justices requested some additional briefing after the first round of briefing specifically on the standard of review for fair use cases. And they also asked specifically for the parties to submit briefing on whether there’s a Seventh Amendment right to a jury trial.

In fair use cases, I thought it was interesting that that Seventh Amendment issue did not come up at all in the argument. Instead, really, the action on that issue seems to be about what is the appropriate standard of review, whether it should be de novo or whether there’s any additional deference that the jury verdict is entitled to.

One issue that did come up, related to that—and I think the government made this argument maybe in the first instance in the oral argument today—is the effect that the Court’s decision might have on future court’s ability to grant summary judgment in fair use cases. I think it’s undisputed. I think everybody would agree that most fair use cases are resolved on summary judgment.

But if the Court were to rule that there is either a right to a jury trial or that a jury has to be given the ability to weigh the four factors that are listed in Section 107 of the Copyright Act that we use to measure fair use, potentially, that would make it much harder for courts to grant summary judgment in the future because the weighing of the four factors could be considered an issue of fact. That’s something that I think the government is very concerned about. Obviously, it has a great deal of expense and time in litigating cases all the way through to a jury trial when they could potentially and have been resolved on summary judgment in the past.

And the last thing I wanted to just mention, and Steve touched on this in his opening remarks, has to do with transformativeness. There were a few questions at the end about “How would you measure transformativeness, which comes in under the purpose and character of use factor, when the work at issue is a computer program?” It did seem like there was some interest from the justices, and, maybe, there is a different way to measure transformativeness when it comes to computer programs, so there would be for other types of works, because by definition, a computer program is only used to achieve a specific function. So how could you have a use that was transformative if the test is for transformativeness is to add additional expression that’s going to actually add something new.

It’s the government’s position and Oracle’s position, in this case, that the fair use factors and the case law that has come up around them, over many years, has made it clear that actually new expression is required. It’s not sufficient to just use the same expression in the context of a different type of platform, and there are examples in the case law of uses of computer software that have been deemed transformative.

But the use in those cases has not involved using them in the new product. It involves what they’ve called intermediate copying or studying the computer software to understand more about how it works so that you can create a different program that does not use the same expression, but that creates interoperable products. But I do think that’s an issue that the justices seem to find interesting and potentially could discuss in a decision.

Steven Tepp:  Great. Thank you both. Nick, have we let people know how that they can signal that they have a question they’d like to ask?

Nick Marr:  No, not yet. But we’ll open up the floor now, so we have a couple of questions in the queue already. We’ll go to our first one now.

Ron Katznelson:  Thank you for holding this Teleforum. Very informative, and I appreciate the panelists’ explanation in such short notice after the hearing. This is Ron Katznelson. I’m the Chairman of the Intellectual Property Committee of IEEE-USA. I’m asking my question not on behalf of IEEE. Perhaps a question for Professor Risch and others. The major question that was raised and particularly a point made by Google is that, to some degree, the code that they write needs to interact with code that developers already know for the merger doctrine to apply.

In other words, would people be able to write compilers for a known code. That, to me, sounds more not a copyright question because there’s nowhere in the statute in which this functional requirement would come up. Isn’t it a question for Congress, not for the Court, as to enable functionality of this sort that the code has to be compatible with what people already know?

Prof. Michael Risch:  So first of all—and this responds also to other comments about we don’t know how famous you need to be—in my view, it doesn’t matter how famous you are. The question is not whether other people know the code or how famous you are. The question is are you providing an interface that you use to control the computer. And so it is up to Congress, and Congress has written in 102(b) that we don’t protect methods of operation, ideas, etc. And so these are things that are excluded from protection.

So, in my mind, it’s up to Congress if it wants to protect these types of interfaces. It needs to say so because as written—and as the Supreme Court precedent has been done, and as the courts have been applying for many, many years—that type of thing is not protected.

Steven Tepp:  Let me jump in to try and go a little deeper on this. There was discussion today about the fact that Apple’s iOS and Microsoft Surface platforms achieve the same functionality, the same interface function, that Google did in Android by copying Oracle’s code. Google says that doesn’t matter because in order to make Oracle’s code work, they had to copy Oracle’s code.

So I think Justice Kavanaugh put his finger on this because he said something about how it really depends how narrowly you define the question. So for both the panelists, is it relevant that Apple and Microsoft both were able to use different code than Google did to show that there are in fact other forms of expression here, or is Google right that the question is narrowly drawn once we decide we want to use the Java Se, then we’re entitled to copy what we need to make that work?

Jordana Rubel:  Well, I can take that first. I guess I would argue that there’s a third option, maybe, somewhere in between. I think it is relevant, generally, to the case that Apple and Microsoft created systems that worked in a completely separate environment, not using the Java language. I think that’s relevant to just understanding, especially, in the fair use analysis, what the marketplace looks like. So I think that has some relevance to the case, but I don’t actually think that that is relevant to the merger analysis.

I think that the merger analysis, what’s relevant there, is if it was possible to write declaring code using the Java language, but I don’t agree with the part of your second option that specifically talks about using the Java SE library. I think it was possible to write declaring code in Java language that didn’t use the calls from Java SE. And I think since it was possible to do that, yes, it would have required the developers, who would be using Android, to learn new calls. It would have required that. But they could’ve still done it using Java, and they did not do that.

Prof. Michael Risch:   Right. So I guess I take the opposite view. I agree with you that that is the question, and I take the opposite view. So, in my mind, the question is this, can you copyright a computer language? The answer, I believe, is no. I think the courts have always said that. I believe Oracle has conceded that. And so if you cannot copyright the computer language by saying, “You cannot make these declaring codes,” you are telling those developers “You cannot use the Java computer language unless you use our software,” and that is where the problem is.

So you must be able to use the declaring code because that is the only way to use – but when I say the only way, I don’t mean it in a merger sense. I mean it in a functionality sense—a method of operation sense. And I don’t mean method of operation as in it’s not copyrightable at all. I mean at the point of infringement, the question we are asking is, is it copyright infringement to reuse declaring code if that’s what it takes to allow people to use a computer language which is otherwise not copyrightable? And if you don’t say yes to that, then what you’re saying is you can copyright a computer language because there’s no other way around that.

Steven Tepp:  But I think I just heard -- what might even be a factual dispute between you, I heard Jordana say that it is possible to write declarations or to write a code, an API code, that performs the same functions in the Java language without copying Java SE.

Prof. Michael Risch:  Yeah, but the language -- you can write declaring code for C. You can write declaring code for Fortran, but you can’t write declaring code for Java because if we write for Java, then Oracle’s going to say, “You’re infringing.” I don’t think it’s a factual disagreement at all.

Steven Tepp:  Well, I don’t think that’s what Oracle was claiming to be fair. But I don’t want to get too far down this road. My understanding is that Oracle was claiming that because Google copied this specific code that happened to be in the Java language, that was the infringement not that Google [crosstalk 34:48]—

Prof. Michael Risch:  Yeah. No, that is what they’re claiming.

Steven Tepp:  Okay. Okay.

Prof. Michael Risch:  That is what they’re claiming, but the problem is there is no other way to allow developers to use the Java language, right? So let’s say I want to make a Java interpreter, and I’m not doing it on Android. I’m going to do it – I think the Java SE implementation is too slow, so I’m going to make My Java, but I won’t call it Java because I don’t want to trademark, right? I’m going to call it My Beans. The only way people can write Java programs that run in My Beans is to have declaring code that matches Java SE; otherwise, people can’t write Java code and have it run in My Beans. So—

Steven Tepp:  I don’t think we’re going to reach agreement on this—

Prof. Michael Risch:  Well, I agree with that.

Steven Tepp:  —but we’ve got other people who want to ask questions, so let’s give them a chance. Nick, who’s next?

Nick Marr:  Okay. And we might be able to go back to it. We only have one question right now in the queue, so we’ll go to it now.

Jack Russo:  Yeah. Hi, Jack Russo from Computerlaw Group. Full disclosure, Mike Risch and I worked together often and disagree often. I think we disagree about this case. The question I have for the group is, what does this case suggest that the high court may do in talking about Alice issues on the patent side? Because it’s clearly not the case that this body of code or this body of work would ever, under Alice, be patentable, and even though counsel made an elegant argue that “Hey, what’s really here is either patentable or not patentable, but it’s not copyrightable,” we all, as IP lawyers, would say, “There’s no way that this would be a patentable subject matter under the current test that exists in the Supreme Court,” and even perhaps not under the current test; maybe, even under traditional law. But what does the suggestions of the Court made today suggest will be the likely outcome when they get to the Alice issues? Thank you.

Steven Tepp:  Anyone want to take that?

Prof. Michael Risch:  I guess I can. So I think that you can divorce it a little bit, right? If you look at Baker v. Selden, they say, “Well, this accounting system, that’s really the kind of stuff you should patent,” and then when you get to patent, they say, “Oh, sorry, no patent for you.” At least, today that’s what they say. I don’t know what they would’ve said then.

And so it may well be the same thing here where they say, “No copyright,” and then you get to the patent, and they say, “Sorry, no patent.” You just can’t protect a computer language by patent or by copyright. So, to me, there’s not too much of an overlap. There were patents in this case. They weren’t all held invalid under 101. So I think it’s possible to have some coexistence.

Jordana Rubel:  Yeah. I guess I would say I largely agree with that. I can’t read the tea leaves and predict what the Court is going to say about this. But I think it is clear from looking at the CONTU report and the current Copyright Act that Congress intended for computer programs to be protectable by copyright, despite the fact that they are inherently functional. And I think Google has tried to make a lot of “hey” about some potential tension between copyright and patent law.

But I think it’s clear, just looking at the CONTU report and the Copyright Act, that Congress did consider that and still indicated that there would be copyright protection. Of course, there is overlap between all the different kinds of intellectual property protection. There’s overlap between design patents and trade drafts. There’s lots of areas where there’s overlap. I think this is potentially one of them, and the question does highlight whether even there is an issue here because maybe under Alice, this type of work is not protectable by patent, and maybe that underscores the importance of protecting it by copyright.

Steven Tepp:  As long as we’re talking about patents, I want to raise an issue that I was thinking about and, full disclosure, this is something I raised in my amicus brief. There’s been some talk about the popularity of Oracle’s code, and, to me, that’s a stand-in term for the notion of some sort of accepted industry standard. And, of course, those familiar with the patent context will quickly recognize that that sounds like standard essential patents—an industry standard in which one or more parties hold patents to some aspect of the standard.

And, here, Google’s saying, “Well, we need to use this, and there’s only one way to write it that works within the framework of Oracle’s code, so that’s what we had to do.” But, of course, when we talk about standard essential patents, we have the notion of fair, reasonable, and non-discriminatory licensing, FRAND. That’s not a rule of law, but it is widely accepted policy, and I think it’s widely accepted as a pro-innovation policy.

And, of course, the underlying assumption in FRAND is that there should be a licensing of rights not that because creating a new standard would be hard or inefficient, that it’s okay to use the IP without consent or payment. So, let me ask both of you, what’s your reaction to the FRAND policy as it could be applied in this context?

Jordana Rubel:  This is Jordana. I can take that first. This question definitely goes beyond any position that the government has taken in this case. I guess all I would say is that I think the government has recognized that some of these atmospherics, like, potentially, if there were not a reasonable license that were available, or if there was no license that was available to Google at the time, potentially, that would be a factual issue that was relevant to the fair use analysis.

And I think the fair use analysis, as we know it, is flexible enough to allow for the court or the jury to take that type of scenario into account as they’re deciding whether the use was a fair use. So, for example, if the work was not being offered for license, at any rate at all, or if we’re only being offered at a completely unreasonable rate, potentially, a court could find that the use of the work without a license was fair, or they could consider it in some other way in the context of that fair use analysis.

Prof. Michael Risch:  So, to add to that, I agree with that a little bit. I wrote an article many years ago—it’s 20 years ago now—that was an economic analysis of computer software reuse, and one of the things I found in trying to reconcile all the different cases that were all loggerheads, much as we are on this one, is that courts, in general, tended to be more likely to allow the reuse where there was a de facto standard or high customer switching costs.

And so, in that sense, I think you’ll see things like merger, or idea expression, or fair use, etc. used, and I don’t take a position on any particular doctrine in that article that might be used, but the courts generally will do that. So I think that’s a good analogue there—a modern analogue for standard essential-type copyright.

In my mind, it doesn’t apply directly because as I’ve noted, I don’t think you need to be a standard in order to not have protection for -- and I shouldn’t say not have protection. You can protect your API, but to not be able to stop other people from implementing that same API with a competing product.

And so in that sense, any API, to the extent it is functional for computer language, is going to wind up being the type of thing that’s a standard whether or not there’s payment for it. And that does distinguish copyright from patent because the reason we worry about standards and patent is because you can stop people, and the reason we haven’t come up with standards essential copyrights is because, until now, the general norm has been “You don’t protect these things.” That could change obviously with this case, but I think that’s definitely a distinction.

Steven Tepp:  So given those responses you both gave, what is the effect on the Court, in this case, that it’s undisputed that Oracle did offer specifically Google a license and generally offered a variety of licenses including open source variance.

Prof. Michael Risch:  In my mind, it’s irrelevant. One of the key factors of fair use is if it applies, it doesn’t -- if there’s a well-established market, that’s one thing, but I think there was some dispute about how well established the market was. But the whole point of fair use is you don’t have to ask for permission, so I guess it goes both ways. I’ll say that. It’s a mixed bag.

I will say I actually favor the protection side much more than the fair use side. I didn’t say a word about fair use in my brief because I actually think this is a much harder fair use case than Google makes it out to be. I’ve never been a huge fan of transformative context either, so I’m not in love with the fair use argument here.

Steven Tepp:  Jordana, do you want to add anything?

Jordana Rubel:  I would agree that whether there was a license available, it does relate to the fourth factor, the fourth-fair-use factor. As it relates to my previous answer, I think had the facts been somewhat different, and if there were an argument, which there isn’t here because of the availability of a license—you’re including the opensource license or the GPL license—there would be a stronger fair use case. Google could make the argument that really this was the only way they could’ve used it. So I think the ability to have used it with a license makes their argument weaker.

Steven Tepp:  So we certainly read in the written briefing and heard today in the oral argument of a wide variety of analogies to what declaring code is. It’s a steering wheel. It’s an electrical outlet. It’s a QWERTY keyboard. It’s a filing cabinet. It’s a grocery store, and so on and so forth. It’s a football team. Sometimes, those seem like they were questions going to the issue of copyrightability, but, other times, it seemed like it was more on this question of established—I won’t say standard and invoke the last question—but something that’s widely used.

And I think that’s how Justice Breyer was using it when he asked Deputy Solicitor Stewart. He said, “This code’s like a QWERTY keyboard. Why does the government see the balance of interest the way it does? It would give the owner of the copyright monopoly power.” And if I may editorialize it, Justice Breyer seemed a little frustrated by the government’s position there. And Stewart’s answer was that not everything is copyrightable, and I think there’s a good case that a QWERTY keyboard is probably not copyrightable. And that, in any event, in this case, consumers don’t need to learn new code. Only the commercial economic actors, the app developers would need to, and that their interest happen to align with Google’s as a result.

It also seemed to me that Stewart may have missed an opportunity there to talk about the basic constitutional purposes of copyright. Madison, in The Federalist Papers, wrote that private rights are fully consistent with the public good. So, on this broader question of what Google would like to call as efficient infringement, well, infringement’s always efficient for the infringer, but is it efficient for the rest of society? What do each of you think about that?

Jordana Rubel:  I can take that first. I do think Malcolm made that important argument in a few places during this morning’s argument. There is balancing that needs to be done between, on the one hand, protecting the incentives for the creation of innovative work and also recognizing the public good.

I think the point he was trying to make is an important one about who actually benefits under Google’s argument. It’s not consumers. It’s not you, and me, and everybody else who uses – or anybody else who uses an Android phone. It’s the developers, and who makes the money off of the developer’s work? It’s Google.

So I think he made that same point, at another point, in the argument that if Google -- if it were in-house people who wrote the apps for Google, and Google said, “Oh, well, it would be much easier for our own in-house people to write the apps if we could reuse this,” nobody would say that that was fair use or that was acceptable copying. So here it’s third parties, but it’s third parties who’s interests are entirely aligned with Google.

Prof. Michael Risch:  Oh, yeah, I’m sorry. I was going to talk, but I didn’t know if you had more.

Jordana Rubel:  No, please.

Prof. Michael Risch:  So I guess if I’m Google, I say this is why we have juries, right, because all this evidence could’ve been presented, and the jury decides. But I guess I will say I’m not sold on the view that there’s no societal benefit. While there are developers, they could save hundreds, thousands of hours making apps that would’ve been spent that allows them to make and sell those apps cheaper.

It allows Android to get off the ground faster. It allows Android to compete with the iPhone faster, which allows prices for iPhone and Android phones to come down. It gives users a choice of apps, either on the iPhone, or on the Android, or on the PC.

So there are lots of arguments to be said that it helps consumers plenty. And, Google, by the way, is giving this away. Now, granted, they get a cut of everything that’s coming in through the app store, but a lot of apps are given away for free. So it’s a debatable point is all I’m saying. I think that saying that society doesn’t gain by reducing switching cost is not necessarily true.

Lotus made the same exact arguments back in the time of Lotus v. Borland, but there was no denying back then that people did not switch away from the Lotus product because they didn’t want to lose all their macros. And so it was critically important that Borland be able to use the Lotus API, which was a very simple one, in order to have macros translate over, and that saved lots of people lots of time and money. Now, in that case, it was end-users and not developers, but there’s no reason why savings to developers can’t be passed through to consumers.

Nick Marr:   And we don’t have any questions in the queue, so we must be coming up on the end of the hour. I’ll offer a chance for closing remarks.

Steven Tepp: Yeah, I was going to do that, and let me invite both our panelists, perhaps at their peril, to make any predictions about the outcome that they would like to make. Mike, will you go first.

Prof. Michael Risch:  I started by saying I wasn’t going to guess, so I really don’t want to guess. It feels like it’s an uphill battle on the protectability question for Google, and, maybe, a little bit of an easier case on the fair use standard of review. But I have no clue how it’s going to come out.

Jordana Rubel:  I think I would largely agree. No real predictions. It did seem like this was not going to be a unanimous Court. Maybe, that’s all I would say.

Steven Tepp:  I think that’s a safe prediction. I’ll venture to say that Justice Breyer’s going to vote in favor of Google, and, beyond that, I think I heard a lot of skepticism about Google’s copyrightability arguments and about their transformativeness arguments, which I think without transformativeness, it’s clearly a commercial use and clearly harms the market.

The only possible saving grace that I heard in the questioning today, for Google, is if their arguments about industry expectations are enough to give the Court some pause. Although, even, then, if I were a betting man, I’d put my money on Oracle. But I agree, it’s not going to be an 8-0.

Nick Marr:  Okay. And with that and those predictions, I will close it out. And I want to say, on behalf of The Federalist Society, I want to thank our experts for the benefit of their valuable time and expertise today, not only in joining this call but in reviewing the arguments today and being ready to discuss them.

For the audience, we welcome listener feedback by email at [email protected]. Be keeping an eye on our website and your emails for announcements about upcoming Teleforum calls, and we’ll be covering the oral arguments in a lot of upcoming Supreme Court cases. So thank you all for joining us this afternoon. We are adjourned.

[Music]

Dean Reuter:  Thank you for listening to this episode of Teleforum, a podcast of The Federalist Society’s practice groups. For more information about The Federalist Society, the practice groups, and to become a Federalist Society member, please visit our website at fedsoc.org.